October has seen UK property prices fall to the lowest level for two years, a new survey has announced. Reductions on properties that have been on the market for some time have been blamed for the decrease.

The monthly national survey by Hometrack reports a year-on-year price deflation of 0.4%, the lowest rate since October 2010. Following rosy economic announcements from the government last week, it is tempting to mark the figures as proof that the UK is making real inroads out of recession.

However, analysts say the deflation was predominantly down to sellers lowering asking prices on homes that have been on the market for some time and failed to attract buyers, rather than a fall in demand.

The lowered prices of old housing stock meant there was a 9.2% increase in property sales for the month from one year previous. Asking prices and achieved prices have become closer over the last six months, with an overall 0.1% decline.